Attempts to reform health care in the United States have always been met with profound skepticism by the average American. While in many European countries, public health care is viewed preferably or – at the least – less ominously, Americans view government intervention in developing health care programs as an affront to their freedoms. The greater the government intervention, the greater the compromise of the economic liberalism that made America become the most prosperous nation in history. Opposing government intervention in economic liberalism has become a cornerstone argument defending “traditional American values” which espouses the virtues of free enterprise and the breakdown of protectionist barriers on the macro and micro levels of the marketplace. Neoclassical economists argued that individuals were inherently rational in that their goal is always to maximize their utility and minimize their losses. To opponents of government intervention in the market, government is an inefficient bureaucracy that compromises this fulfillment of human nature. Inherent in the economic liberalist philosophy is an overt rejection of the government intervention that marginalized an individual’s potential to maximize utility and minimize their losses.
Economic liberalism stressed the importance of the ‘individual.’ Today, we enjoy a world that has become institutionally and economically liberal. However, opponents of government intervention warn that the lessons of the 20th century suggest that vigilance against encroaching government influence in the economy should not be compromised. The economic battle of the 20th century was highlighted by two economic philosophies: capitalism and communism (or more appropriately, socialism).
Capitalism was embodied by the United States of America. Communism was represented by the Soviet Union. These two economic philosophies could not have been more different: where capitalism stresses private control and free enterprise, communism views society the whole to be more important than the individual. In a communist society, the government owns the land, it owns the capital equipment, and it owns the labor. Tales are replete with inefficient government ownership from those who fled communism whether in former Soviet Republics, Cambodia, or Cuba: famine, labor camps, and lack of freedom of speech and expression are some elements of the scenes described. Economic liberalism confesses that capitalism has its flaws, including inequality of resources, poverty, and perhaps even a level of callousness towards human life if improperly employed. After all, free market assumes individuals are self-interested, and sometimes self-interest can become cruel if unfettered. But, introduce government intervention and these problems are exacerbated. A major entity like government bureaucracies simply cannot be expected to understand the complexities involved in daily interactions between individuals in the market place.
John Keynes launched an economic revolution by supporting the concept of interventionist governments in economics in order to stimulate depressed economies. Government intervention could circulate more money into industry which boosts employment. In doing so, government could create a positive feedback cycle that will leak down to the micro level of the market, allowing individuals to restore the health of the economy from there. While he supported the idea of free market, he also viewed government intervention in economic liberalism as essential in providing a safety net for when the free market lost its equilibrium and began to decay and suffer. Although this idea of “mixed economy” helped stabilize economies in the aftermath of World War II, Keynes faced criticism from both supporters and critics of government intervention in the economy. While communists challenged him for being too “capitalist”, supporters of economic liberalism warned of the dangers of Keynesian economics. Socialist philosophy, critics argue, operates in such a way that even if not intentionally done, it grows and inevitably crushes private industry which cannot compete with the machinery of government. Socialist philosophy may have good intentions, but its product is always an inefficient government monster whose inadequacies cannot be minimized no matter how it is dressed up as.
Opposing government intervention in economic liberalism has resulted in large scale implementation of economic liberalization across the world. Following the Second World War and the beginning of global democratization, the World Bank (and subsequently, the International Monetary Fund) was established to intensify development in developing countries by providing loans to fund projects that created development. In theory, this was intended to lure countries into supporting free market and enterprise over socialist philosophy and protectionism. Its results have been mixed: In Latin American, for example, growth fell by 50% from 1960-80 and 1980-2003, a period that coincided with the IMF, in exchange for partial debt relief, enforced an economic structure on the participating countries (devaluation, trade liberalization etc.). In order to service these loans, governments are forced to cut expenditure on areas such as infrastructure and health care. In this sense, these measures accomplish the goal of economic liberalization, while failing many of the local populations in these countries of former government-run programs.